(b)

1. (1) The title insurer shall, at least annually, conduct an on-site audit of its appointees’ underwriting, claims, and escrow practices, which shall include a review of the title insurance agency’s policy blank inventory and processing operations.
2. (2) If the title insurance agency does not maintain separate bank or trust accounts for each title insurer it represents, the title insurer shall verify that the funds held on its behalf are reasonably ascertainable from the books of account and records of the title insurance agent.
3. (3) A combined audit must encompass the activities of all affiliates to which title insurance agents or title insurance agencies are appointed.

(c)

1. (1) Within thirty (30) days of executing or terminating a contract with a title insurance agency, the title insurer shall provide written notification of the appointment or termination and the reason for termination to the Insurance Commissioner.
2. (2) Notices of appointment of a title insurance agency shall be made on a form promulgated by the commissioner.

(d)

1. (1) A title insurer shall not appoint to its board of directors an officer, director, employee, or controlling shareholder or any title insurance agent who wrote five percent (5%) or more of the title insurer’s direct premiums written during the previous calendar year as shown on the title insurer’s most recent annual statement on file with the commissioner.
2. (2) This subsection shall not apply to relationships governed by the Insurance Holding Company Regulatory Act, Arkansas Code § 23-63-501 et seq.